The population of Washington continued its downward slide last year, dropping to 674,000, according to new U.S. Census Bureau estimates, despite a surge in housing construction and renovation.

The Census Bureau said the number of city residents last July 1 was down 11,000 from a year earlier and 83,000 fewer than the number counted in the 1970 census.The decline since the start of the decade, the bureau said, has been 11 percent.

Both government and private experts suggested that the paradox of a shrinking city population amidst a real estate boom reflects the District of Columbia's two major demographic trends: the influx of young professionals and the departure of families for the suburbs.

"All the indicators we use show the District's population is taking a nose dive," said Donald E. Starsinic, the Census Bureau demographer in charge of preparing the new report. "Even with all the building activity that's happened in the last few years, there's no pickup (in the population).

"The same thing happens whenever you upgrade an area," Starsinic added. "You come up with a much more handsome and livable area, but not as many people."

The new census report also shows a very slight increase in the population of Maryland, up only 6,000 in a year to 4,143,000 in mid-1978. Growth in Virginia was more substantial, a one-year increase of 53,000 to 5,148,000.

Throughout the country, the Census Bureau said, the population grew last year by 1,676,000 to 218.1 million. The growth rate for the 1970s continued to be the slowest since the 1930s, chiefly because of a sharp downturn in births.

Virtually all the growth occurred in the South and West. Six states along the eastern seaboard lost population last year -- Massachusetts, Rhode Island, Connecticut, New York, New Jersey and Pennsylvania.

Alaska also recorded a slight drop following completion of its oil pipeline, which earlier in the 1970s had produced a population boom.

Starsinic said Washington's continued population loss is comparable to that of other large, older cities, mostly in the North and Midwest. However, the estimate for Washington is a year more up-to-date than those for other American cities because it is issued at the same time as the estimates for the states.

James O. Gibson, the District's new assistant city administrator for planning and development, said similar population declines have been occurring in the big cities of Western Europe as well as of the United States.

He said the declines are caused mainly by changes in the location of industrial production and jobs.

New industries are settling in suburban and rural areas, attracting bluecollar workers, Gibson said, while technical and professional jobs are increasing in cities, drawing those who are better educated and more affluent.

Gibson said the District's new administration, headed by Mayor Marion Barry, will try to keep a mixture of social classes in the city by mounting an "aggressive program" to create blue-collar jobs by attracting light industry, particularly along New York Avenue.

Since 1970, Maryland's population has grown by 5.6 percent, far slower than the increase of 26.2 percent between 1960 and 1970. In Virginia, the increase since 1970. In Virginia, the increase since 1970 has been 10.7 percent, compared to a gain of 17.2 percent during the 1960s. Washington's population fell by just 1 percent from 1960 to 1970 compared to the 11 percent drop during the past eight years.